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EchoStar, Viacom Go for the Jugular

On days when the markets are down and consumer confidence is, too, it pays to step back a bit for perspective. In the cosmic scheme of things, a 1% sell-off in the Nasdaq, while painful, isn't that big a deal. What is? How about a photo taken by the Hubble telescope looking back more than 13 billion years? That's within a few hundred million years of the Big Bang.

And the work's just beginning. According to astronomers, finding the faintest (farthest) objects in this view of the Hubble Ultra Deep Field will be like "trying to collect the light from a firefly hovering over the moon (really, these guys are poets). They also compared the image to "looking at the sky through an eight-foot soda straw." Finally, something we can relate to -- now what did we do with that eight-foot soda straw....

That old tag line "I want my MTV" may be the battle call for customers caught in the middle of a roiling showdown between satellite television provider EchoStar Communications(Nasdaq: DISH) and network owner Viacom(NYSE: VIA). EchoStar yanked off the air all Viacom stations after the two companies couldn't agree on payment hikes, and neither company looks ready to back down.

Channels that EchoStar customers won't get include such well-known TV real estate as BET, Comedy Central, MTV, Nickelodeon, and VH-1, as well as the top-rated CBS network. The markets involved are major ones, including New York, Boston, Dallas-Fort Worth, Los Angeles, and San Francisco; the move affects 1.6 million EchoStar customers who receive CBS local programming, and all 9.5 million customers who receive the national stations.

EchoStar's public statement today contained fightin' words, accusing Viacom of "holding the public airwaves hostage" by asking for 40% rate increases for its channels; it urged its customers to call Viacom and protest. It's offering a reimbursement of $1 for CBS, and $1 for the rest of the national Viacom stations, for impacted customers -- hardly the kind of discount anyone would really feel at all on their monthly statement. (Heck, it's possible many of us are already pretty disgusted with what we're paying regardless -- Rex Moore recently pointed out rate hikes across the industry.)

Viacom, on the other hand, dismisses EchoStar's move to shut down its channels with an "easy" fix for customers. The network provider is suggesting to customers just make the switch to other means of receiving its channels, which include cable providers Comcast(Nasdaq: CMCSA) or Cox Communications(NYSE: COX), satellite archrival DirecTV, owned by Hughes Electronics(NYSE: HS). (Coincidentally, Fool contributor W.D. Crotty wrote about satellite wars yesterday in regard to satellite provider Pegasus Communications(NYSE: PGTV), but who knew this gang was so ready to rumble?)

At last check, EchoStar shares were up about 2%, though they've been sagging over recent weeks as this issue -- and the deadline for negotiations -- loomed. The idea that EchoStar's customers will miss out on major channels that are pretty much ubiquitous on rival cable and satellite providers' basic packages is risky. Regardless of which company's wearing the black hat, I have a funny feeling EchoStar customers aren't feeling too sorry for either party right about now.

Nike, which reports results next Thursday, said this morning that third-quarter earnings would jump more than 50% year over year from between $0.71 to $0.74 per share, well ahead of the $0.64 per share analysts estimated. Meanwhile, revenues will gain more than 20%, putting that figure near $2.9 billion.

The company attributes the better-than-expected performance to strength in both the U.S. and Asia Pacific regions, as well as a continued benefit from currency exchange rates in Europe. While year-over-year comparisons were helped by the fact that "prior year revenues were unusually low" due to the timing of shipments, one thing is clear: Nike is in pretty good shape.

One issue awaiting resolution is Nike's soured relationship with Foot Locker(NYSE: FL). However, indications point to warming relations, which investors anticipate could have Nike's high-end shoes back on Foot Locker's shelves in the coming quarters. When that happens, Nike's business in the U.S. could see a further boost.

Great as it sounds, the improving business and smoother relationship with Foot Locker are likely priced into the stock's more than 60%, 52-week run-up. After another 3% pop to $76.59 in early afternoon trading today, Nike, like LeBron, has some big expectations to live up to.

It may seem odd to find consistency in an amusement park operator. Between the ups and downs of the cyclical travel industry and disposable income levels, one might expect a wild ride.

We've all heard Disney(NYSE: DIS) cry "Uncle" and Six Flags(NYSE: PKS) whine about its heavy debt burden when the economy isn't smiling just right. Why then, has fellow operator Cedar Fair(NYSE: FUN) seemed to move forward in good times and bad?

When Cedar Fair sees a wall of worry, it simply builds a thrill ride to scale it. It follows that the company raised its quarterly distribution yesterday, to $0.45 a unit. At yesterday's close, that gives the tax-advantaged limited partnership a yield of 5.2%.

At this rate, Cedar Fair will have raised its distribution for 17 consecutive years. Readers of our Income Investor newsletter know all about the beauty of buying into a company that perpetually hikes its payout.

In fact, Cedar Fair has raised its quarterly payout 13 times over the past 10 years. Sure, the hikes appear petty at first glance; however, over that decade, the distributions have grown by 80%. Compare that to fixed income investments with flat payouts or money market funds with their paltry interest in recent years, and stomaching some more risk with income-producing equities seems like an appealing alternative.

Consider paint manufacturer Sherwin-Williams(NYSE: SHW), which has hiked its dividend every year since 1979. Pitney Bowes(NYSE: PBI) has done so for 22 straight years. While investors shouldn't turn their backs on high-growth companies that reinvest their earnings to grow their businesses, there are clearly some notables that have managed to excel on both fronts.

Some can even pack a little octane in the tank. Cedar Fair was one of the earliest recommendations in our newsletter that became Motley Fool Hidden Gems and it has certainly performed well. The units have risen by 40% over the past year, and that's before you tack on the meaty quarterly distributions. Now, that's some ride!

Longtime Fool contributor Rick Munarriz loves his amusement parks. He went to Cedar Fair's Cedar Point last year and will be off to the company's Knott's Berry Farm in California come June. He owns shares of Disney as well as units in Cedar Fair.

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